Fake Currency Worth Rs 167 Crore Has Been Seized By The Govt In The Last 5 Years & Pakistan Is A Big Contributor To It

More than 26 lakh fake notes of the denomination of Rs 500 and Rs 1000, with a face value of approx Rs 167 crore, have been either recovered or seized by the Reserve Bank of India (RBI) and law enforcement agencies in India from 2011 till 2015 as per data on the Lok Sabha website.

The data as stated above has been released by the Lok Sabha, which has sourced it from the National Crime Records Bureau (NCRB). This data was presented in response to questions raised at Lok Sabha.

Among the fake notes recovered from 2011 till 2015, the highest are of the denomination of Rs 500. Furthermore, the number of fake notes of denominations of Rs 1000 and Rs 500 are greater than those of Rs 100 and Rs 50.

Economic Times

The Economic Times earlier today reported that the government’s decision to demonetise Rs 500 notes was mainly prompted by confidential reports of security agencies revealing the rampant use of notes of this denomination in the fake currency network.

Union Finance Minister Arun Jaitley in an interview to media today also stated that the RBI had initially recommended to demonetise only Rs 1000 notes. But later the government also decided to ban Rs 500 notes in a bid to root out black money and Fake Indian Currency Notes (FICN).

FICN Seized

The data reveals that 99,050 and 3 lakh fake notes of the denomination of Rs 1000 and Rs 500 were seized in 2011 alone. The numbers increased over the years.

Economic Times

A total of 7.64 lakh counterfeit notes of denomination of Rs 1000, having a face value of Rs Rs 76.47 crore were recovered. A total of 18.20 lakh fake notes of the 500 denomination, having a face value of Rs 91 crore were recovered.

Minister of State for Finance Arjun Ram Meghwal on August 2 this year in reply to a question in the Rajya Sabha said the face value of FICN in circulation was found to be about Rs 400 crore. The data was revealed in a study undertaken by the Statistical Institute (ISI), Kolkata.

Pakistan Conspiracy

Sources to ET explained that the quality of the FICN indicates that they can be made in currency making machines, which are only available with sovereign states.

According to today’s Economic Times report, in more than 95 per cent cases, fake Rs 500 notes were traced to Pakistan.

The then Minister of State for Home Affairs Haribhai Parathibhai Chaudhary on December 8 last year in reply to a question in the Lok Sabha had said, "As per the inputs available, high quality fake Indian currency notes (FICN) are printed in sophisticated presses located in Pakistan. High quality fake Indian currency notes seized in India and abroad, originate only from Pakistan which has created a self sustaining criminal network in the South and South-East Asian Region for infusing FICN into India.”

The smuggling of FICN into India occurs from neighbouring countries, including Bangladesh, Nepal and Pakistan.

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Terror Funding

The FICN being pumped into India is also used in terror funding. "Out of the 11 cases being investigated by the NIA involving production, circulation and smuggling of high quality counterfeit currency, in one case, evidence has come on record indicating that fake currency was being used to fund terrorism. During the investigation of the case pertaining to the activities of David Coleman Headley and others, it was revealed that Fake Indian Currency Notes were given to him for use in India," Chaudhary had said in reply to another question in the Lok Sabha in March last year.

Measures Taken

A special FICN coordination (FCORD) group has been formed in the Ministry of Home Affairs (MHA) to share intelligence amongst the different security agencies to stop the circulation of fake currency notes in India.

The government has also constituted a Terror Funding & Fake Currency Cell (TFFC) in the National Investigation Agency (NIA) to probe terror funding and fake currency cases.

A Memorandum of Understanding has been signed between India and Bangladesh to prevent the smuggling and circulation of fake currency notes.

The government has also constituted a Combating Financing of Terrorism Cell (CFT Cell) in the MHA to coordinate with the Financial Action Task Force (FATF), an inter-governmental International Body dealing with anti-money laundering and CFT issues.